Probably stupid questions, but I am trying to answer a customer complaint concerning how we determined the Index used to calculate their new rate. The note states the index is: the weekly average yield on US Treasury securities adjusted to a constant maturity of one year, as made available by the FRB. The most recent index figure available as of the date 45 days before each Change Date is called the "Current Index". Our system is tied to the Fed's H.15 release.

When it says "made available by the FRB" is that the same as published?

Since the forecast time is 45 days, are we responsible to have the index information so that the system picks up the rate for the exact date?

I appreciate any help with this. Thanks!

Well, most banks specifically reference H-15 in their notes. As far as 45 day prior - the answer to that is yes - the index on that date.

I am still confused on how to explain to our customer, we use the H.15 but we only reference the weekly average yield... in our notes. The weekly average is published on Monday at 4:15, we pull it on Tuesday. I am confused on how the 45-day forecast requirement factors in when using the weekly average rate, since that would not always be exactly as of the 45th day. For the loan in question, we used the published weekly rate prior to the forecast day. (Ex. Forecast -- 11/17, used the weekly rate from 11/12 published. The next published rate would not occur until 11/19).

Any additional help would be appreciated.

If it is published on Monday, then that rate is the effective rate until the next publish. I think you are making this harder than it needs to be.

Thank you! I definitely was making it harder than it need to be!